Dictionary of Real Estate Terms: homeowners protection act of 1998
homeowners protection act of 1998
requires private mortgage insurance companies to inform borrowers of their right to cancel mortgage insurance when the loan amount is no more than 80 percent of the value of the home. When the loan is no more than 78 percent of value, insurance is automatically cancelled. Covers mortgage loans originated after July 31, 1999. Automatic cancellation under the law is based on the value of the home when the loan was originated, or may be based on a market-value appraisal paid for by the borrower. Lenders may retain mortgage insurance coverage on loans where there has been a recent history of delinquent payments.
